Howdy, While I am quite literally a flunkie, I hope I can offer some insight. I think the question being asked results from the inherent sloppiness of language, specifically, the word "market."
A market, my intuition tells me, is any place, real or virtual, where goods and services are exchanged...voluntarily. "Goods," "services," and "voluntarily" should be taken to be defined quite loosely. For example, if the state confiscates my car, that is not a voluntary exchange; however, if it then sells my car for a set, non-negotiable price to a willing buyer, that is voluntary. I think the question derives from the fact that formally defined concepts like "competitive market," and ill-defined political concepts like "free market" are grouped under the umbrella term "market." Hence, using the umbrella term I can assert that the United States has a market economy whereas North Korea does not. Does this mean that North Koreans do not obtain their goods at a market? I don't think so. They go to the state run store to buy meat voluntarily. It's just that the price of meat and the quantity available is set by a central authority. So when the alien asks, "What is a market?" and "What is a market economy" she's really asking about two different concepts. The former is a more or less tangible "institution" (that's the wrong word, I know), and the latter is an umbrella "concept" for competitive or free markets per se. So when we say that China doesn't have a market economy, what we are saying is that China's markets are ones where competition, or laissez-faire do not obtain, i.e. we are saying that China suffers from dirigisme. We are not asserting that goods and services are not exchanged, we are merely using sloppy language. Best to you, -jsh __________________________________________________ Do You Yahoo!? Yahoo! Health - your guide to health and wellness http://health.yahoo.com